Layoffs hit Walmart's Allswell brand

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Dive Brief:

Walmart is laying off Walmart eCommerce workers in New York from its Allswell direct-to-consumer home brand in addition to other corporate functions focusing on its incubation efforts, a company spokesperson confirmed to Retail Dive. Business Insider first reported the news.

The layoffs, which impact 29 of the 56 total employees at that office, are effective April 24, according to a WARN notice filed in the state of New York.

According to a company spokesperson, “the Allswell brand and its team members will get integrated into the Walmart business.”

Dive Insight:

Allswell was Walmart's "first homegrown digital brand," and launched at a time when DTC brands like Casper and Leesa were already, in part, leading a disruption to the mattress category.

The layoffs come as Walmart works to restructure its digital strategy away from relying on acquisitions and its Jet unit. After going on a purchasing spree, picking up digital natives like ModCloth, Bonobos and Eloquii, the retailer appears to be reconsidering those acquisitions. Last summer, a Recode report revealed Walmart's e-commerce unit was on track to lose more than $1 billion by the end of 2019, and the retailer reportedly mulled unloading its Bonobos and ModCloth acquisitions, the latter of which it did sell in October to financial services firm Go Global Retail. And Jet, the online retailer it acquired in 2016 for $3 billion, lost its independent executive role as Walmart announced the operations would be folded into its broader Walmart.com unit, a move paralleling the recent Allswell decision.

"Our incubation strategy was designed to create unique brands that reach niche customer audiences," a company spokesperson said in a statement emailed to Retail Dive. "We're integrating many of these brands as private brands within Walmart as we continue to deepen our category expertise and strengthen our ability to offer customers a larger range of products. Walmart will continue to sell Allswell's mattresses, bedding, and other products online at allswellhome.com, on Walmart.com and in Walmart and Sam's Club stores."

And just over a month ago, Bonobos founder Andy Dunn, who also oversaw Walmart's digital consumer brands, exited the company. In a LinkedIn post published at the time, Dunn said he and his digital brands team worked on an omnichannel strategy that "married our talent with the power of Walmart distribution to build brands like Allswell."

Walmart recently launched several private labels under its broader e-commerce umbrella, in categories like beauty, baby, apparel and home.